Sahara rushes to pay Rs 24,000 cr, beat SC deadline

Vijay Pandya, 42, is a worried man. Pandya, a lawyer by profession who lives on Mira Road in Mumbai, had invested around Rs 1,00,000 in the Sahara Housing Investment Corporation (SHIC) and was expecting good returns.

"I do not know whether I am getting my money back, let alone the interest. Though the company gave advertisements in newspapers, I have not received a single penny as yet," said Pandya.

Pandya is not a lone investor in Sahara group companies who is worried - there are three crore of his ilk.

People are clueless about the status of their investment in the two Sahara Group investment companies, which are required to return Rs 24,000 crore to investors by the end of next month.

On August 31, the Supreme Court had ruled that finance schemes run by two Sahara companies - Sahara India Real Estate Corporation (SIREC) and SHIC - were illegal and ordered it to repay, within three months, Rs 24,000 crore to up to almost 30 million mostly small investors

The company said it would not comment for this story as the matter was "sub-judice."

Though in newspaper advertisements it had said that it would return the money to investors, there is still lot of mystery that surrounds the issue. "You need not worry about anything and be at absolute peace as Sahara is the most dutiful and absolute honest custodians of your money and by the grace of god, we are so healthy with all-round strength that there cannot be even one day delay in any payment commitment of Sahara," the Sahara Group said in a statement.

The whole issue started in 2010 when Roshan Lal, an Indore-based chartered accountant, sent a letter requesting the National Housing Bank (NHB) to investigate housing bonds issued by Sahara India Real Estate Corporation (SIREC) and SHIC.

The letter was forwarded to the market regulator Securities and Exchange Board of India (SEBI) and an investigation was carried on.

"Luckily for SEBI Sahara Prime City a Sahara group's real estate arm had filed a draft red herring prospectus (DHRP) for an IPO. SEBI reviewed information regarding the bond issued by the two companies in question, which was mentioned in the DRHP itself," said a SEBI official. Soon after a battle between SEBI and Sahara started at the end the latter was asked to refund Rs 24,000 crore.

While Sahara has said that it would repay the money investors remain uncertain. Sahara has also sought a review of the SC order of August 31. The company said that it would refund the money to investors but was seeking the review of the order to protect its image in the eyes of the public. "The company may also be looking to extend the deadline for repaying the amount to investors. From what we hear the company wants the deadline extended by a year," said an investment banker who has earlier done business with the group.

The Sahara group has also accused SEBI for refusing to accept documents of the investors, which the company was required to submit to the market regulator to meet the deadline set by the SC. Sahara alleged that the trucks were waiting since the evening of September 10 outside SEBI Headquarters but not allowed inside.

What if Sahara is unable to repay?The Supreme Court has allowed SEBI to attach properties of SIREC and SHIC and freeze the bank accounts of the two companies in case the company does not comply to the order.

While both firms are unlisted, the share prospectus filed by Sahara Prime City mentions that SIREC on March 2009 had Rs 1,17,161 in reserves, Rs 13,721 of sales and a net loss of Rs 3,756.

In November 2010 SEBI had barred Sahara Group from collecting funds from the public. At that time the group had claimed it had Rs 1,09,224 crore assets in 2010.